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Owing More And Feeling Worse — What We Overlook About Debt And Mental Health

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Focusing on around 8,500 working-age adults, Lawrence Berger of the University of Wisconsin-Madison and his research team took data from two waves of the National Survey of Families and Households, conducted six years apart and ending in 1994.


While it was not surprising that 79 percent of respondents had some debt – totaling an average of $42,000 – the results were the first to show the impact of different types of debt on depression and their effects on different sectors of the US population.


Adjusting for measures of socio-economic status, and refining their analysis to subgroups defined by age, education and marital status, a clear association between debt and depression began to emerge. To be sure that depressed people weren’t simply more likely to go into debt, Berger and his team controlled for reverse causality and had the same results (Berger et al., 2015).


“The findings could also be used to help mental health practitioners better understand the impact of clients’ borrowing habits on depression” (Berger, 2015).


Another study found similar results.


Carrying out a systematic review on all previous research which looked at the relationship between health problems and unsecured debt, researchers from the University of Southampton, along with a researcher from Kingston University, conducted a ‘meta-analysis’, to statistically combine the results of previous studies involving nearly 34,000 participants.


The results were compelling. Those in debt were more than three times more likely to have a mental health problem as those who were not in debt. Further, less than nine percent of participants with no mental health problems were in debt, compared to more than a quarter of participants being in debt and with a mental health problem. Specifically, those in debt were also more likely to suffer from depression, drug dependence, psychosis and suicide (Richardson et al., 2016).


Dr. Thomas Richardson, Clinical Psychologist from the University of Southampton who led the research, concluded, “This research shows a strong relationship between debt and mental health; however it is hard to say which causes which at this stage. It might be that debt leads to worse mental health due to the stress it causes. It may also be that those with mental health problems are more prone to debt because of other factors, such as erratic employment. Equally it might be that the relationship works both ways. For example, people who are depressed may struggle to cope financially and get into debt, which then sends them deeper into depression” (Richardson et al., 2016).


“Debt advisers should consider asking about mental health when speaking to members of the public. Similarly mental health professionals should ensure they ask about whether their patients are in debt” (Richardson, 2016).


As there is currently around $156 billion in unsecured debt such as credit cards in the UK – of which the average family owes more than $11,000 – and levels of debt have increased in recent years due to the economic recession and are predicted to increase further, the issue of debt is especially relevant to students, and has left many asking: What is the psychological cost of massive student loan debt?


To find an answer, researchers at the University of South Carolina and the University of California, Los Angeles used data from the National Longitudinal Survey of Youth 1997, a nationally representative sample of young adults in the Unites States and posed the following two questions: What is the association between the amount that students accrue during undergraduate studies and their mental well-being post-graduation, when they are between the ages of 25-31; and what is the association between annual student loan borrowing and the mental well-being of currently enrolled students?


Even with adjustments for parental wealth, childhood socioeconomic status, and other factors, debt emerged as a major contributor to mental health such that those who had higher amounts of debt incurred from student loans reported higher levels of depressive symptoms (Walsemann et al., 2015)


“We are speculating that part of the reason that these types of loans are so stressful is the fact that you cannot defer them, they follow you for the rest of your life until you pay them off” Walsemann, 2015).


Walsemann’s study is particularly significant given the ongoing rise in the costs of obtaining a college degree. In 2012, student loan debt totaled over $1 trillion in the United States, making this type of loan second only to home mortgage debt. “We speculate that the American middle class is suffering the most from post-graduation debt, since they do not qualify for governmental assistance, nor is their family able to take on the bulk of the costs associated with college,” explains Walsemann (Walsemann, 2015).


While further research will likely reveal how student loan debt affects other life decisions, such as occupational choices or delaying marriage and children, and other health inequities, another study found that the effects of debt are not just psychological.


The study, done by researchers at Northwestern Medicine, and published in Social Science and Medicine, offers a glimpse into the impact debt may have on the health of young Americans.


Using data from the National Longitudinal Study of Adolescent Health, Elizabeth Sweet, an assistant professor of medical social sciences at Northwestern University Feinberg School of Medicine and a faculty associate of Cells to Society (C2S): The Center on Social Disparities and Health, at the Institute for Policy Research at Northwestern and her team explored the association between debt and both psychological and general health outcomes in 8,400 young adults, ages 24 to 32 years old.


Personal financial debt was measured in two ways. Participants were asked about their debt-to-asset ratio by answering this question: “Suppose you and others in your household were to sell all of your major possessions (including your home), turn all of your investments and other assets into cash, and pay off all of your debts. Would you have something left over, break even or be in debt?”


Second, participants were asked how much debt, besides a home mortgage, they owe. Response categories ranged from “less than $1,000” to “$250,000 or more.”


Perceived stress, depressive symptoms and general health were measured through a series of questions. Both systolic and diastolic blood pressures were measured on each participant by a field interviewer.


Here are some key findings of the study:

  • Twenty percent of participants reported that they would still be in debt if they liquidated all of their assets (high debt-to-asset-ratio).


  • Higher debt-to-asset ratio was associated with higher perceived stress and depression, worse self-reported general health and higher diastolic blood pressure.


  • Those with higher debt were found to have a 1.3 percent increase (relative to the mean) in diastolic blood pressure – which is clinically significant. A two-point increase in diastolic blood pressure, for example, is associated with a 17 percent higher risk of hypertension and a 15 percent higher risk of stroke.


  • Individuals with high compared to low debt reported higher levels of perceived stress (representing an 11.7 percent increase relative to the mean) and higher depressive symptoms (a 13.2 percent increase relative to the mean) (Sweet et al., 2016).


“We now live in a debt-fueled economy. Since the 1980’s American household debt has tripled. It’s important to understand the health consequences associated with debt” (Sweet, 2016).


Sweet notes that while we wouldn’t necessarily expect to see associations between debt and physical health in people who are so young, it is an association we need to be aware of.


Debt is not simply an economic concern, or the burden of a poor performing economy. It is a major contributor to our mental health, and lies at the heart of how we feel about our lives, our future, and our well-being. And it is something we should all be paying more attention to.

Owing More And Feeling Worse — What We Overlook About Debt And Mental Health

Claire Dorotik-Nana, LMFT

Claire Dorotik-Nana LMFT is a licensed marriage and family therapist specializing in post-traumatic growth, leveraging adversity, and other epic human achievements. Claire has written multiple continuing education courses for Professional Development Resources, Zur Institute, and International Sport Science Association. Claire has also authored multiple books, including:
Leverage: The Science of Turning Setbacks into Springboards and On The Back Of A Horse: Harnessing The Healing Power Of The Human-Equine Bond. For more information about Leveraging Adversity or Claire, visit

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APA Reference
Dorotik-Nana, C. (2019). Owing More And Feeling Worse — What We Overlook About Debt And Mental Health. Psych Central. Retrieved on October 21, 2020, from


Last updated: 20 Oct 2019
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